What Is At Stake?

On June 23, 2016, a referendum was held in the United Kingdom (UK) to decide whether the United Kingdom should leave or remain in the European Union (EU). The decision to leave won over the decision to stay by 52% to 48%. On March 29, 2017, the UK government will triggered Article 50 of the Treaty of the Functioning of the European Union (TFEU), starting formal negotiations to leave the European Union.

Beyond being unprecedented (it will be the first time that an EU Member State will have left the European Union), the process of the United Kingdom leaving the European Union — commonly known as “Brexit”— is complex at all levels. While the length of the process (two years or more) and outcome of the negotiations remain unclear, the consequences of Brexit will be far-reaching and will impact the United Kingdom and its EU and global trading partners in many and possibly unforeseen ways.

Companies across all industries and of all shapes and sizes will be affected in a variety of ways, including in areas related to intellectual property and corporate brand protection. What will be the impact of Brexit on the European Union Trade Mark (EUTM)? What will be its impact on the United Kingdom’s participation and influence in the European Union Intellectual Property Office (EUIPO)? How will Brexit affect registration and protection of trademarks, designs, geographical indications, and other intellectual property rights currently harmonized under EU legislation? How will Brexit impact IP protection in the EU Customs Union? What will the effects be on the UK legal profession? How will companies based in or trading with the United Kingdom be affected?

While many of these questions remain unanswered, INTA has followed developments to ensure that its international membership has access to current information on how Brexit could impact them and to offer guidance as to steps they can take to anticipate these changes. While it is likely that many decisions will be made at a political level by UK and EU authorities, INTA will continue following Brexit policy-related issues closely, working directly with the United Kingdom Intellectual Property Office (UKIPO), EUIPO, relevant EU authorities, and as many other stakeholders as possible to try and ensure that IP and brand-related issues are properly considered as negotiations take place.

What Is Next?

For the UK, Prime Minister Theresa May received the backing of her cabinet on November 14 (despite several resignations that ensued) will have to put the agreement to the vote in the UK Parliament. She managed to win a ‘defiance’ vote in her own party (200 in favor, 117 against) on December 11. She will now need to find a majority in favor of the deal in the UK Parliament by January 21, 2019. At this date, she needs to inform the Parliament of her intentions if the deal is not adopted.

On November 14, 2018, the European Union (EU) and the United Kingdom (UK) have finally succeeded in agreeing on a draft deal on the withdrawal agreement (the ‘divorce’ phase). This agreement in principle between the EU and UK negotiators paves the way for the formal adoption of the agreement by the UK government and the European Union, respectively.

On the other hand, the EU and the UK are still negotiating the second phase, ‘the future relationship’, with an agreement on this expected by the end of the year or early next year. The ratification and adoption process will depend on the nature of the future relationship.

On March 29, 2019, the UK is expected to leave the European Union at 11pm. This will open the ‘transition period’ to last until December 31, 2020 (with one possible extension).

Key Dates

During a European summit in Brussels on December 13, 2018, the EU27 and the UK released conclusions on the Brexit that stress that the backstop to prevent a hard border with Ireland – the main bone of contention—is only “temporary” and “an insurance policy”

UK Prime Minister Theresa May won a ‘defiance’ vote in her own party (200 in favor, 117 against) on December 11, 2018.

During a Summit on November 25, the EU27 approved the draft agreement on the divorce (a simple majority was required) as well as a political declaration on the setting out the framework for the future relationship between the European Union and the United Kingdom. The latter is a political document – not a legally binding one – for which the unanimity of the EU27 was required. This document provides the basic frame for the future relation, i.e. an “ambitious, broad, deep and flexible partnership”, whose nature – customs union? Free-Trade Agreement? Other? - has yet to be determined. This partnership should cover “trade and economic cooperation, law enforcement and criminal justice, foreign policy, security and defense and wider areas of cooperation”. The declaration nonetheless leaves the door open for “areas of cooperation beyond those described in this political declaration”. It includes a point VII on intellectual property (paragraphs 44-47) which notably stress that the parties should provide for IP protection and enforcement “beyond the standards of [TRIPS and WIPO] convention where relevant” as well as the “freedom to establish their own regimes for the exhaustion of intellectual property rights“. Finally, the parties agreed to “establish a mechanism for cooperation and exchange of information on intellectual property issues of mutual interest, such as respective approaches and processes regarding trademarks, designs and patents”.

On November 14, the European Union (EU) and the United Kingdom (UK) have succeeded in agreeing on a draft deal on the withdrawal agreement (the ‘divorce’ phase). The European Commission has also published a Q&A on what’s in it here, and an Ireland and Northern Ireland-specific one here. Most of Title IV (article 54 to 61) which covers ‘intellectual property’ was already agreed in principle. Trademarks, designs, databases and even plant variety rights were addressed and agreed in principle. The main principle put forward then remains, i.e. “continued protection in the United Kingdom of registered or granted rights”. Also, the draft agreement kept its regional exhaustion principle whereas “intellectual property rights which were exhausted both in the Union and in the United Kingdom before the end of the transition period under the conditions provided for by Union law shall remain exhausted both in the Union and in the United Kingdom”. The outstanding issues – Geographical Indications (GIs), registration procedure and pending applications for supplementary protection certificates in the UK – are now agreed. For GIs, the UK will be granting automatic rights to EU GIs “as from the end of the transition period”, until a future relationship is established, though the UK will still have to pass a legislative act to enshrine GI protection into UK law. Registration will be carried out “free of charges” and IP right-holders will “not be required to introduce an application or to undertake any particular administrative procedure”, nor to “have a correspondence address in the United Kingdom in the 3 years following the end of the transition period”.

On July 23, the UK government has updated its ‘IP and BREXIT: The facts’page, including, for the first time, statements about its intentions regarding continued protection of rights (specifically in case of a ‘no-deal’ scenario).

On July 19, the European Commission adopted a Communication (a non-legislative document) outlining the ongoing work on the preparation for all outcomes of the United Kingdom's withdrawal from the European Union. Indeed, Stakeholders, as well as national and EU authorities, need to prepare for two possible main scenarios: 1) If the Withdrawal Agreement is ratified before 30 March 2019, EU law will cease to apply to and in the UK on 1 January 2021, i.e. after a transition period of 21 months; 2) If the Withdrawal Agreement is not ratified before 30 March 2019, there will be no transition period and EU law will cease to apply to and in the UK as of 30 March 2019. This is referred to as the "no deal" or "cliff-edge" scenario.

On July 12, the UK government has published its long-awaited Brexit white paper which details its set of proposals regarding the UK’s future relationship with the EU. It notably stresses that the new relationship with the EU should be “broader in scope than any other that exists between the EU and a third country”. The UK is aiming for a free trade area for goods, giving frictionless border access. This would “protect the uniquely integrated supply chains and ‘just in time’ processes” with no “costly customs declarations”. This would “enable products to only undergo one set of approvals and authorisations in either market, before being sold in both”. There would be separate arrangements for services, giving the UK freedom “to chart its own path in the areas that matter most for its economy”.

‘Brexit’ Minister David Davis submitted his resignation on July 9 – as he believes the current status leaves the UK “in a weak position” with regards negotiations. He was then followed by Foreign Secretary Boris Johnson. Dominic Raab (former Minister for Housing and Planning) becomes the new ‘Brexit’ Minister while Jeremy Hunt (former Secretary for State for Health and Social Care) becomes the new Foreign Secretary.

On June 28-29, EU27 heads of States and governments said they were expecting Ms. May to come up with a concrete set of proposals on what she expects from the Brexit agreement on several issues (future relationship, border with Ireland, notably). As President of the Council of the EU Donald Tusk stressed, “there is a great deal of work ahead, and the most difficult tasks are still unresolved. If we want to reach a deal in October we need quick progress. This is the last call to lay the cards on the table”.

The UK Parliament adopted the EU Withdrawal Act on June 26. This Act enables EU law to be transferred into UK law in order to ensure a smooth Brexit. While several MPs pushed for Parliament to have a final say -a “meaningful vote”- on the Brexit agreement, their amendment was ultimately defeated

The negotiations on the second phase - the ‘future relationship’ – opened officially on April 16-18 are ongoing – with little progress to show for- ever since, despite several rounds.

On March 22-23, the EU27 Council formally adopted the negotiating guidelines for the second phase – the “future relationship” – of the Brexit negotiations. The EU aims at a Free Trade Agreement (FTA) with the UK, which would include “other areas of interest to the Union, for example (…) protection of intellectual property rights, including geographical indications”. Moreover, the EU stresses that “personal data protection should be governed by Union rules on adequacy with a view to ensuring a level of protection essentially equivalent to that of the Union”.

On March 13, the UK deposited its instrument of ratification to join the Geneva Act of the Hague Agreement on the International Registration of Industrial Designs. While it will come into effect on 13 June 2018, it will ensure, once Brexit occurs, that UK applicants can continue to use the system and allowing non-UK applicants to designate both the EU and the UK in one parallel application

On February 21, the UK published its own draft text on the transition period (application of EU law in UK territory) once Brexit occurs. IP is not part of the list of provisions in Annex I for which Union law would not apply even during the transition period. The end of the transition period in the text remains 31 December 2020 as proposed by the EU.

On March 1, the European Commission published its draft Withdrawal Agreement between the European Union and the United Kingdom. This draft translates into legal terms the Joint Report from the negotiators of the European Union and the United Kingdom Government on the progress achieved during phase 1 of the negotiations, published on 8 December 2017. Intellectual property is included in a Title IV (article 50 to 57) which covers IPRs, TM, design, exhaustion of rights notably. The main principle put forward by the Commission in this IP title is “continued protection in the United Kingdom of registered or granted rights.” This draft will serve as a basis for the negotiations for the EU and will have to be addressed by the UK negotiators in order to agree on a final common text.

On March 8, a leaked draft of the EU negotiating guidelines for the second phase of the Brexit negotiations (to be adopted during the EU27 Summit on March 22-23) was circulated. The EU aims, for its future relationship with the UK, at a regular FTA with the UK once it is out. This FTA would include notably: Zero-tariffs trade in goods; “appropriate customs cooperation, preserving the regulatory and jurisdictional autonomy of the parties and the integrity of the EU Customs Union”; “other areas of interest to the Union, for example (…) protection of intellectual property rights, including geographical indications”. On data protection, the EU stresses that “personal data protection should be governed by Union rules on adequacy with a view to ensuring a level of protection essentially equivalent to that of the Union”.

On January 29, the EU27 General Affairs Council (all Member-States except the UK) adopted their directives setting out the arrangements for its withdrawal from the European Union. These directives, to be followed by the EU lead negotiator Michel Barnier during the negotiations, indicates notably that “in line with the European Council guidelines of 15 December 2017 and with the negotiating directives annexed to the Council Decision of 22 May 2017 as supplemented by these negotiating directives, it is necessary to complete the work on all withdrawal issues, including those not yet addressed in the first phase. These include –without being confined to –issues such as (…) intellectual property rights, (…) customs-related matters needed for an orderly withdrawal from the Union, protection of personal data and use of information obtained or processed before the withdrawal date”. Moreover, the EU27 Council stresses that the transition period “should not last beyond 31 December 2020”.

On January 9, Prime Minister Teresa May announced a –relatively limited- reshuffle of her UK government. While most senior figures remain in post (Boris Johnson as Foreign Secretary or David Davis as Secretary of State for Exiting the European Union), a major change was the ‘IP portfolio’ then held by Jo Johnson (then Minister of State for Universities, Science, Research and Innovation) moving to Sam Gyimah, Minister of State for Higher Education.

On December 14-15 2017, the EU27 Heads of States and government (without the UK) held a meeting where they adopted guidelines agreeing that “sufficient progress” has been achieved in the first phase of the Brexit negotiations(i.e. the ‘priority issues’: UK citizens living in the EU and EU citizens living in the UK, the ‘bill’ to be paid by the UK to the EU and the border with Ireland, notably, thereby opening the way to the second phase of the negotiations ( EU-UK future relationship) which should include all outstanding issues (including IP which had not been negotiated yet).

On December 14, the EU Commission published a Notice, countersigned by EUIPO, to holders of and applicants for European Union trade marks and Registered Community Designs in the context of the notification of the intention of the United Kingdom to withdraw from the European Union, submitted on 29 March 2017.

The main issue of contention now is the timing of moving up to the next phase of negotiations (i.e. on the new relationship between the EU and the UK). While the mandate stipulates that “sufficient progress” on the ‘exit’ phase is needed to move on to the other (initially foreseen for October), the EU Commission clearly stated that there was no “sufficient progress” after the last round (a position shared by the EU Parliament in its – non-binding- resolution adopted on October 3), thereby postposing negotiations on the new relationship to December at best.

On October 9-12, the fifth round of ‘Brexit’ negotiations between the EU and the UK took place in Brussels. The discussions once again focused on citizens’ rights, the financial settlement and the border with Ireland with “no great steps forward (…) reached”. The closing joint press conference can be found here.

On September 25-28, the fourth round of ‘Brexit’ negotiations between the EU and the UK took place in Brussels. The discussions focused on citizens’ rights, the financial settlement and the border with Ireland. The parties published an updated Joint technical note on EU-UK position on citizens' rights. The closing joint press conference can be found here.

On September 22, UK Prime Minister Theresa May gave her third important speech on Brexit in Florence (Italy), stressing that the UK wants a transition period (“around two years”) aimed at bridging the gap between leaving the EU in March 2019 and beginning the new trading relationship. On the financial settlement, she confirmed that “the UK will honor commitments it has made during the period of our membership”, without mentioning a number. The speech can be found here.

On September 6, the European Commission publishes its position paper on intellectual property. The document notably recognizes that "the holder of any intellectual property right having unitary character within the Union and granted before the withdrawal date should, after that date, be recognized as the holder of an enforceable intellectual property right in relation to the United Kingdom territory, comparable to the right provided by Union law – if need be on the basis of specific domestic legislation to be introduced". It then sets the principles regarding applications for IPRs with unitary character; applications for supplementary protection certificates or for an extension of their duration; legal protection of databases; and exhaustion of rights.

On August 28-31, the third round of ‘Brexit’ negotiations between the EU and the UK took place in Brussels. The discussions focused on citizens’ rights, the financial settlement, the border with Ireland, the overall governance of the withdrawal agreement and other separation issues (Euratom, goods placed on the market, on-going Union procedures, judicial cooperation in civil and criminal matters). The parties published an updated Joint technical note on EU-UK position on citizens' rights.The closing joint press conference can be found here.

On July 17-20, the second round of ‘Brexit’ negotiations between the EU and the UK took place in Brussels. The aim of this four-day round, which took place in Brussels, was to present the respective positions). Following the round, the parties published a Joint technical note on EU-UK position on citizens' rights.The closing joint press conference can be found here.

On June 19-20, On 19 June 2017 Michel Barnier, the EU Chief Negotiator, and David Davis, Secretary of State for Exiting the European Union launched the first round of Brexit negotiations. This two-day event took place in Brussels. Apart from the structure of the negotiations and forthcoming issues, the opening of negotiations focused on issues related to citizens' rights, the financial settlement, the Northern Irish border and other separation issues. The closing joint press conference can be found here.

On April 18, UK Prime Minister Theresa May called for an early General Election, to be held on June 8.

On April 19, the UK House of Commons agreed to a motion to hold the early General Election.

On March 29, 2017, UK Prime Minister Teresa May officially triggered Article 50 with a letter to Donald Tusk, President of the European Council, notifying him about the UK’s intention to leave the EU. To read the full letter, please click here.

On February 1, 2017, the House of Commons voted to advance the bill that would give Prime Minister Theresa May the authority to invoke Article 50 of the TFEU—the formal process of leaving the European Union.

On January 17, 2017, UK Prime Minister Teresa May laid out her vision in a landmark speech. While she said that “Brexit means Brexit,” there is a lot of debate about what that will mean in practice, especially concerning the two key issues of how British firms will do business in the European Union and what limitations will be placed on the rights of EU nationals to live and work in the United Kingdom. More of her negotiating hopes can be found in in her key speech on Brexit.

On August 2, 2016, the UKIPO published a guide entitled “IP and Brexit: the Facts,” available here.

On June 23, 2016, a referendum was held in the United Kingdom to decide whether the United Kingdom should leave or remain in the European Union. The decision to leave won by 52% to 48%.

INTA in Action

On October 31, INTA provided comments to the UK Department for Environment, Food and Rural Affairs on the new proposed UK GI Scheme.

On July 27, INTA sent to the World Intellectual Property Organization (WIPO), the UK Intellectual Property Office and the European Commission its comments on Article 52 of the Draft Agreement on the Withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community as published by the European Commission on March 19, 2018. This document relates to the continued protection in the United Kingdom, after the transition period contemplated in the draft agreement, of international registrations of marks and designs protected in the European Union before the end of the said transition period, under the Madrid Protocol and the Geneva Act of the Hague Agreement.

In July, INTA sent a letter on the exhaustion of rights after Brexit to the UKIPO, calling for the adoption of a national (UK only) exhaustion regime, or if membership in the EEA continues, a regional exhaustion regime, provided that certain criteria are met.

On June 14, Toe Su Aung (Elipe global, UK, Member of the Brexit Cross-committee Task Force) attended a meeting organized by the UKIPO the primary purpose of which was to discuss whether data relating to licence recordals, security interests and insolvency proceedings recorded against EUTMs and community designs at EUIPO should be ported over post-Brexit.

On March 29, INTA was invited, together with a few selected associations, by the UK Minister of State for Universities, Science, Research and Innovation, in charge of IP, Sam Gyimah MP, to exchange on the status of IP in the Brexit negotiations. INTA was represented by Philippa McLeod (Rolls-Royce plc, UK, Member of INTA Board of Directors, and co-leader of INTA Brexit Taskforce). This meeting provided the opportunity for INTA to reiterate its main point: IP-related issues should be treated as “technical” issues by the negotiators in order to be resolved relatively easily, pragmatically and quickly. Failure to address IP issues in a timely and appropriate manner could trigger adverse effects for businesses, small and medium-sized enterprises, and consumers operating in or with the UK.

A high-level delegation, composed of INTA CEO Etienne Sanz de Acedo; Board of Directors Member Philippa McLeod (Rolls-Royce plc, UK); Mireille Valvason (Novartis, Switzerland); Jeremy Newman (Rouse, UK, Chair of INTA’s Anticounterfeiting Committee); and INTA Chief Representative Officer ‒ Europe Hélène Nicora, to meet with UK authorities in London on February 26‒28. The delegation met with the UK Intellectual Property Office (UKIPO), the City of London Police Intellectual Property Crime Unit, Justice Arnold, the Chartered Institute for Trade Marks Attorneys, and the Chartered Institute for Patent Attorneys. INTA’s delegation promoted its Brexit position paper, adopted by the Board in November 2017, and insisted that most IP-related issues, since they were neither controversial nor political, could be relatively easily and quickly resolved. However, failure to address them in a timely and appropriate manner could trigger adverse effects for businesses and SMEs operating in or with the UK.

The INTA Board of Directors on November 7, 2017 approved a position paper drafted by the Brexit Cross-Committee Task Force, which forms the basis of INTA’s advocacy efforts. The position paper outlines core general principles and specific recommendations related to IP for both the UK and the EU-27 regarding the negotiations concerning the exit of the UK from the EU . It is publicly available here.

In March 2017, recognizing the need to further advocate for strong IP protection and harmonization as the process of Brexit negotiations unfolds, INTA formed a Brexit Cross-Committee Taskforce to make recommendations on issues of particular concern to INTA. The Brexit Cross-Committee Taskforce consists of volunteers from the Legislation and Regulation Committee/Europe and Central Asia Subcommittee, Trademark Office Practices Committee/European National TM Offices Subcommittee, Trademark Office Practices Committee/EUIPO Subcommittee, Trademark Office Practices Committee/Madrid System Subcommittee, Anticounterfeiting Committee/EU Subcommittee, Parallel Imports Committee, Designs Committee, and Geographical Indications Committee.

In March 2017, INTA published theBrexit Brands Toolkit: Preparing Brand Owners for Brexit. Drafted by INTA’s Brexit Rapid Response Group, this document serves as a guide for companies on key Brexit issues and on determining the allocation of sufficient resources to prepare a company’s brands for Brexit.

In October 2016, INTA CEO Etienne Sanz de Acedo met with corporate representatives in London to exchange their concerns about Brexit. The event was organized by INTA members Elipe Limited and Mathys & Squire LLP.